The setting is a web-based app that charges a fee per month to use the service.
You have rent, utilities, servers, developers, graphic designers, marketing, legal, accounting, office supplies, software and other expenses.
Which of these fit into the "official" definition of overhead?
Put a different way, if you were raising money and were asked: "How much of this money will be spent on overhead?" what would you include in this calculation.
My feeling is that for this type of a business nearly every dime you spend is overhead. You could possibly argue that the salary paid to the developers could be variable costs and, therefore, not necessarily overhead. I am having trouble seeing how that might hold water.
I could see the costs of hosting above a certain baseline level qualifying as variable costs.